Supply-Side Reforms Increase Healthcare Access and Affordability

Key Quotes

"It's a frustrating thing I think for economists as we watch this debate where you know they're saying if the subsidies expire or they don't it'll change the cost of healthcare that's not true all that's going to change is who pays for it does the federal government pay for it or do individuals pay for it and while that's an important question it doesn't get at what I think we do care about which is how much are we spending on healthcare overall and how much care are people actually getting for the money that we're spending."

Economist Craig Garthwaite argues that the current debate around healthcare subsidies is misdirected. Garthwaite explains that focusing solely on who pays for healthcare (the government or individuals) does not address the fundamental issue of overall healthcare spending and the value received for that spending. He believes the conversation should shift to efficiency and actual care provided.

"The first of these recommendations is to ease restrictions on doctors who have been trained in other countries can you explain how that would work yeah I mean the idea would be that we want to increase the supply of people who can provide medical services with if we have more people who are intentionally coming here with the goal of treating low income Americans it'll provide more access and ideally lower cost."

Garthwaite proposes easing restrictions on foreign-trained doctors as a way to increase the supply of medical professionals. He suggests that by allowing more qualified international doctors to practice in the U.S., particularly those intending to serve low-income populations, access to care can be improved and costs potentially lowered. This approach aims to address the supply side of healthcare services.

"We have a ready made set of providers these mid level providers who have advanced training they are not uh doctors in the sense that they have an md or a do degree but they've gone through a lot of advanced training and for a lot of primary care research has shown that they provide exceptional care for individuals in addition they are a lower cost input that could be more readily deployed across the healthcare ecosystem."

Garthwaite highlights the potential of nurse practitioners and physician assistants as a valuable resource within the healthcare system. He explains that these "mid-level providers" have advanced training and can deliver exceptional primary care at a lower cost than physicians. Garthwaite suggests that expanding their roles could help deploy more care efficiently across the healthcare landscape.

"There's so much discussion and so much of the debate we're going to have in congress over the next two weeks is going to be about insurance coverage which is good but it's a necessary but not sufficient condition for getting access to healthcare and I think we'd like to see the debate focus more on what actually gets people care and that has to be a supply side conversation where we think about who's providing the care and not just what economists refer to as the demand side conversation which is who's paying for the care."

Garthwaite emphasizes that while insurance coverage is important, it is not the sole determinant of healthcare access. He advocates for a shift in the national conversation from solely discussing who pays for care (demand side) to also focusing on who provides care (supply side). Garthwaite believes this supply-side focus is crucial for ensuring people actually receive the healthcare they need.

"Medicaid comes out of the great society programs in 1965 it is intended as a very small program for the very very poor and disabled and widows and orphans even if you go to 1990 right so now now we're only talking 35 years ago there were only 20 million Americans that were on the program if you go to last year they were nearly 80 million Americans on the program it includes kids it includes seniors in nursing homes it includes half of all births in the United States and so it has become this sort of unwieldy program that was never designed for the size and the scope of the patient population that it's currently covering."

Garthwaite provides historical context for the Medicaid program, explaining its original intent as a small safety net for the extremely poor and vulnerable. He points out the significant expansion of Medicaid since its inception, noting its current vast scope covering millions of children, seniors, and accounting for half of all births. Garthwaite concludes that Medicaid has become an "unwieldy program" due to its size and the broad patient population it now serves, which differs from its initial design.